16. In attribute estimation sampling (AES) technique, which of the following is

Question

16. In attribute estimation sampling (AES) technique, which of the following is not a true statement when an auditor compares the maximum population exception rate (MPER) with the tolerable exception rate (TER)? (Hint: consider magnitude) a. If the maximum population exception rate is marginally higher than the tolerable exception o. atche mavimum population exception rate is significantly lower than the tolcrable exception c. Ir the maximum population exception rate is marginally higher than the tolerable excepti d. If the maximum population exception rate is significantly higher than the tolerable exception rate, revise the tolerable exception rate. rate, accept the internal control as being reliable rate, reject the internal control as being reliable. on rate, acceptable risk of over-reliance should not be revised

Explanation / Answer

Ans. (d) if the maximum population exception rate is significantly higher than the tolerable exception rate acceptable risk of over reliance should not be revised.

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